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Archive for the ‘ eBusiness ’ category

Field of Dreams

So many business ventures operate what I call a “field-of-dreams” business model, i.e. “build it and they will come”. There’s no need to worry about market research, prototyping, promotion, advertising, just build it. They – the audience, the customer, the user, whatever – will come.

Hmmm. it might have worked for Kevin Costner in a feel-good Hollywood movie, but it’s not a great business approach. Few hits happen serendipitously.

One example oft cited of the “field of dreams” reality distortion field is Rovio’s phenomenally successfully Angry Birds game, which started off as an iPhone application and has gone on to become a mass-market phenomenon, with follow up games across all platforms and merchandise from hundreds of licensees. But Angry Birds was not just a fluke success. Rovio developed dozens of games before hitting the jackpot with Angry Birds. Rovio didn’t just build one field of dreams hoping it would attract and audience, they built dozens, constantly refining their approach, both technically and conceptually with each one. I would argue that they designed with success in mind, and then once they had a modicum of grass-roots following, marketed the hell out of it, to grow it into the worldwide smash it became.

Angry Birds

The same applies to an incentive program. You cannot hope that you can just launch it and it will be successful. You have to promote it to get that user engagement, and making accessing the online site a regular habit, Motivation campaigns are most effective with regular contact with users, and continuous reinforcement of the aims of the program and the benefits to be had.

It’s also crucial to be able to tweak things. The danger of the “build it and they will come” approach is to think that once it has been built no further work is necessary, and that therefore all the work should be front-loaded. But when the program meets the users is when the work really starts. To be successful an incentive program must adapt over the course of the activity, with new content, new functionality, and to respond to the usage patterns that emerge. As we have said before, an incentive program that does not adapt will soon become irrelevant to its participants, or it will lock-in behaviours for just doing the same old things.

Field of Dreams

So rather than “build it and they will come”, we would advocate “plan carefully, build it quickly, communicate widely to users, then tweak in response to feedback”. It might not be as catchy, but it is more effective to pursue an iterative approach and evolve a winning solution. To continue the baseball analogy it’s about building an innings rather than trying to hit it out of the park with the first swing of the bat.

Tuesday, January 3rd, 2012

Stop oiling the squeaky wheel

Categories: eBusiness, Motivation

The squeaky wheel gets the grease

“The squeaky wheel gets the grease”, runs the proverb, underlining the human tendency to focus our attention on immediate concerns rather than plan proactively for the future.

I was thinking about the squeaky wheel syndrome when discussing a client’s incentive program that had taken a downturn in activity, and crucially, attention from their marketing manager.

Part of the problem was that the incentive program we operate for them runs smoothly, worry and hassle free, But this also allowed them to direct their attention onto other issues, and stop thinking about ways to improve and adjust their incentive program. As a result the program was starting to look a little stale, and was no longer engaging its users to the degree it had previously. There were no short-burst campaigns, no themed promotions, no e-mail marketing. Users were earning points for doing the same old things, or in many cases no longer earning them. Their business had moved on but the incentive hadn’t.

Left untouched the incentive program would have become a big problem that needed fixing. It wasn’t a squeaky wheel yet, but it would soon become one. Fortunately, we were able to work with the marketing manager, and suggest a refresh of the promotion, and a mini-reboot, which has re-energised the incentive and seen reward levels, user engagement and most importantly, the Return on Investment all back to where they should be. If things had of gotten worse these simple measures would not have been enough to restore users engagement.

What parts of your sales and marketing are a ‘squeaky wheel’? By only focussing on immediate problems, planning for the future can often take a back seat, leading to bigger problems down the road. Ultimately it’s an inefficient and ineffective way to work. Often squeaky wheels are masking bigger problems that need to be addressed, and at other times a ‘squeaky wheel’ needs to be replaced not just remedied.

In 2012, it’s time to stop oiling the squeaky wheel. This year, it is all about being proactive, not reactive. Now is the time to start planning the future, not waiting for it to happen. Start by auditing your current activities and service providers and decide if they are functioning well, and if not, whether they should be forgotten, fixed, or fired.

“Stop the Sabotage” says Nigel Botterill, who in this video goes into a lengthy anecdote about finding Rick Stein behind the counter early one Saturday at his Seafood Deli in Padstow.

Stop the sabotage from The Wow Company on Vimeo.

To summarize:
Ian the fishmonger wasn’t upselling.
Barbara the cashier wasn’t registering users to the mailing list.

Whilst Stein was there that Saturday notionally to “keep his hand in”, ‘Botty’ understands that he was there to stop the inadvertent sabotage of his business. While he is at pains to point out that the staff were otherwise very good at their job, they weren’t going the extra distance. This is because they did not see it as part of their job, there was no benefit or motivation for them to do that. As a consequence, the business was losing out on valuable custom. Rick Stein was prepared to go the extra mile, because he could see the bigger picture, and understand how he could add value to the customer relationship. As the owner of the business, he also had the vested financial interest, of course.

Rewards can change this staff default modus operandi by providing a direct benefit to go beyond the job description. A structured incentive program like iD-points can go further still – to reinforce the behaviours with communication to help staff understand the ‘why’ as well as the ‘what’. It can supplement the basic reward with additional rewards for their ideas and feedback too.

While Botterill is right that no-one will ever care as much as a business as the business owner, incentives can at least help to make them care a lot.

Wednesday, October 20th, 2010

HiPPOs create toxic workplaces.

Categories: eBusiness, Motivation

In business, decisions are often made by the person who takes home the biggest paycheck. This is known as the HiPPO problem (Highest Paid Person’s Opinion). As this article states:

“HIPPO is the high level manager who comes to your project at the last moment and offers an opinion on what to include to make the project a success. And you must consider it, even if the idea is out of scope, past deadline or […] crazy”

People who throw their weight around without regard for the considered opinions of those below them on the org chart, create toxic workplaces. Eventually, people will start deferring more and more decisions to the HiPPO, rather than seeking creative solutions for themselves that may get overruled on a whim. And of course, it continues to feed to ego of HiPPOs to think they are geniuses (otherwise why else would they be paid so much?) who can turn their instinctive insight onto whatever they rest their eyeballs on.

All of this leads to a culture of complacency for most and the feeding of rampant egos for few. This state of affairs may be hidden or ignored when times are good – as Pixar founder Ed Catmull says, “success hides problems” – but does not bode well for long term success. Motivation systems that continually reward the same behaviours, or only reward the superstars, fuel complacency and egotism, reinforcing the toxic workpace.

At the Harvard Business Review, Peter Sims thinks that Google, who he thinks are at a ‘pivotal moment in its history’ could learn from Pixar, where processes are in place to ensure that success doesn’t breed complacency.

“what Pixar has that Google does not is a culture where the fear of complacency is a strong motivator, where new problems are identified, discussed, and addressed openly and honestly, all of which requires humility”

Humility of top executives, and active steps to prevent complacency, resting on laurels, are key tenets of the Pixar approach, and ones that all companies should embrace. Motivation programs can be used to help stir up new ways of working, and help ensure that the best ideas win, regardless of where they came from.

Or as that old warhorse Winston Churchill once said: “Success is not final, failure is not fatal: it is the courage to continue that counts”

Tuesday, October 19th, 2010

Meet the New Consumer.

Categories: eBusiness, Human Resources, Incentives

The recession has changed the marketplace forever. The New Consumer will change the way that business and consumers think and behave. From now on, there is a permanent shift in the consumer mindset, and this will translate into the way that businesses operate in order to survive and prosper.

So what does the New Consumer look like

  • The New Consumer is more careful about what they buy.
  • The New Consumer want to feel connected to the things they own.
  • The New Consumer is looking for long term value rather than short term cost saving.
  • The New Consumer will only buy once they are convinced it is the right product for them.
  • The New Consumer values their time more than ever.

The continued growth of companies like Apple is an object lesson that people are willing to spend, and often pay more, for items that they believe will last longer, serve them better, and save them time. Consumers are growing tired of cheap, poorly made stuff that doesn’t last, clutters up their houses, and makes them feel guilty when they have to throw it out. The new consumer wants to own fewer but better things that have a deeper resonance with them.

A report by Price Waterhouse Coopers states that this mindset is likely to remain even after the recession has ended.

“Companies need to recognize that there will not be a wholesale return to a pre-recession shopping mode and will need to adapt to the changed behaviors and patterns to win in today’s changed marketplace”

This should represent a seismic shift in how businesses sell to their customers. Customer service is becoming ever more important, in helping consumers find the product which is right for them, rather than trying for the quick sale.

This is not just about the High Street, but online retailing too. A recent report by Fast Company shows that bad customer experience when buying online leads to not only a negative impression which is unlikely to lead to repeat custom, but that ‘cart abandonment’, the termination of the sales transaction, could be costing US businesses up to $44 billion a year.

This also needs to filter through to incentive programs. Incentives should focus not just on rewarding the sales team for making the sale, but rewarding everyone involved in making the customer feel like a king. Smarter sales incentives look at the bigger picture and focus on building longer term relationships with customers. Most customer loyalty programs, rubber stamping a card for a chance of a free coffee or a discount, are lazy choices. They are no match for a structured internal incentive solution that empowers employees to offer killer customer service, by:

  • rewarding them to improve their knowledge so they can offer better advice
  • rewarding them to improve their skills so that they are better employees
  • rewarding them for going the extra mile
  • making the right sale to the customer
  • recognising the lifetime value of a customer

For an inspirational video on how far customer service can take you, check out this video, Creating Lifetime Customers, from Chris Zane of Zanes Cycles. It’s over an hour long but it’s well worth it, and at the end of it you may feel like you want to open a bicycle shop.

What’s also fascinating about Zane’s presentation is that Zanes isn’t just about B2C retail, as they also fulfil bikes for a number of incentive programs for clients including American Express and Tropicana. The same lessons apply to the incentives market. As a provider of incentive services and product fulfilment, we are representing our clients to their customers, and sitting in the middle. To be successful, we need to provide great service both ways.